The AI Advantage: 10+ Insights on AI’s eCommerce Revolution

Many experts say that AI is going to have a big impact on eCommerce. But how do we exactly understand AI’s impact, if at all?

According to Business Dasher, some of the eCommerce statistics may give you a hint on how AI is increasingly influencing the eCommerce landscape:

• 51% of eCommerce businesses employ AI to some extent (And let’s assume that more will do so in the future).
• AI-powered recommendation is responsible for a 25% rise in sales, while 15% reports a boost in reviews due to AI.
• Up to 3x boost in conversion rates with AI (which is huge!).
• 4 in 5 eCommerce businesses are either actively working on integrating AI solutions into their business or having it as their first priority.

With that being said, numbers are still numbers. They are unable to narrate the full story about the transformative role of AI.

This article delves into 10+ trends and innovations in AI that are enhancing the eCommerce landscape. We will explore visionary insights on future AI developments and top consumer expectations and concerns as AI becomes increasingly useful and familiar in the eCommerce industry in the future.

AI in eCommerce: A Heated Topic

As we posted our latest query on Connectively, we were immediately blown away by the huge wave of responses that flooded our query box. Over 90 answers in 2 weeks’ time and more responses are expected to come.

You may wonder, what is the question that sparks the active wave of discussion? The question is no other than the influence of AI in eCommerce: “What do you think is the impact that AI is taking in the eCommerce world?”.

The influx of response, as we further reflected, highlighted two main points.

Firstly, since many of the contributors are CEOs and founders of eCommerce companies, it is clear that AI trends and innovations are top-of-mind for industry leaders. They are actively considering how to integrate AI into their eCommerce strategies.

However, the variety of responses shows that the possibilities of AI can be massive. AI seems to not just be a passing trend, but rather a fundamental shift in how eCommerce companies operate. Each response features unique experiences and results, reflecting how AI applications are rapidly growing as the technologies mature.

From the answers, AI’s eCommerce impact extends beyond sales but affects personalization, customer service, marketing, fraud detection, and even tracking & logistics.

10+ Key AI Trends and Innovations in eCommerce

With the enormous mix of responses, here’s what 10+ eCommerce experts say about the impact of AI in eCommerce, either from their own or their clients’ experiences:

Post-purchase and Personalization

Across all the responses, the most discussed application of AI in eCommerce is its influence on enhancing post-purchase and personalization. They suggest that eCommerce players should move beyond viewing purchase as the only touchpoint, and one should embrace a holistic and long-term view of customer relationships.

In particular, they highlighted the various possibilities of using AI to capture customer behaviors and drive personalized engagements.

Dan O’Keeffe, Founder of SPX Marketing

A talking point that is emphasized by Dan is the role of AI in building a world-class marketing experience. With Dan’s extensive experience in building digital ventures via SPX Marketing, he remarked that AI-driven analytics is “instrumental in enhancing client acquisition and retention strategies.” His clients, as Dan exercises his marketing approach, experience a remarkable 30% increase in customer engagement and improved conversion rates.

However, he highlights a common challenge across his businesses: The seamless integration of AI technologies. To tackle this, Dan’s team has crafted bespoke solutions that enhance data flow and decision-making while ensuring minimal disruption to existing systems. 

By investing in robust integration solutions, companies can pave the way for efficient operations and enhanced customer experiences.

Steve Jacob, Tech Manager at IT Path Solutions

On the other hand, Steve also shares a similar perspective, asserting that AI plays a crucial role in “revolutionizing post-purchase experiences.”

By leveraging customer data, Steve suggests, businesses can engage customers in a way that was once impossible before, which may include “personalized product recommendations, tailored email campaigns, and timely follow-up messages.” To tackle the data integration issues in eCommerce when applying AI, Steve suggests a need to invest in data hygiene practices and smoother data processing to support these enhancements.

Sarah Fletcher, CEO of Flower Delivery

In the online flower delivery industry, Sarah Fletcher, the CEO of Flower Delivery, illustrates how a hands-on, practical industry can also put personalization into play with AI.

Her AI application comes from utilizing machine learning-based recommendation engines to tell which flower arrangements most customers are likely to choose based on their order history and the time of the year.

This strategy has enhanced Flower Delivery’s upselling techniques but also retains customers by adding a “personal touch” to the customer experience.

Sarah comments heavily on the importance of balancing AI and the interpersonal engagement that it entails. To support her efforts, Sarah adopted customer sentiment analysis to ensure that such interpersonal engagements remained intact, which helped her preserve the “human side” of the flower business.

Guillaume Drew, Founder of Or & Zon

Guillaume Drew, founder of Or & Zon, shares insights on the challenges of implementing AI into eCommerce. While he strongly believes that AI-driven algorithms enhance personalized communication and cross-selling, sourcing and integrating the right tools is difficult and requires significant research, upfront investment, and technical training.

Despite these challenges, however, Guillaume believes that the improvements in efficiency and customer experience, quoting from his words, “make it worth the effort.”

Search Experience

On the other hand, AI is having an increasing influence on optimizing the search experience, as several founders are building AI-driven SEO tools for their eCommerce clients.

Eric Koenig, Founder and Creative Director of Sitehike

The name of Eric’s business, Sitehike, reflects a clear mission to enhance SEO efforts through AI. As he comments on the practical applications of AI, Eric suggests that AI can help process and analyze vast amounts of data, making them “especially useful for SEO.” By introducing AI-driven SEO solutions, Sitehike has helped countless small and medium enterprises thrive in the digital landscape.

Eric has observed significant SEO improvements for his clients, resulting in up to a 30% increase in web traffic. As AI capabilities continue to evolve, they make SEO efforts more scalable and attainable with just a click of a button.

Hansjan Kamerling, Co-founder of Adaptify AI

Adaptify AI is an interesting concept by Hansjan Kamerling. With AI increasingly prevalent in the eCommerce world, Hansjan also eyes an opportunity with his venture. His team has developed AI-driven solutions that optimize the search experience of numerous eCommerce players, and it is seamlessly integrated with platforms like Shopify and WordPress.

By automating repetitive tasks in SEO, Hansjan’s solutions help eCommerce businesses free up resources, so its customers can concentrate on strategic initiatives or improve operational efficiency in the long run.

At TrackingMore, we also share a similar vision. Our tracking solution effectively manages logistics on the back end, enabling eCommerce businesses and dropshippers to take control and refocus on their sales and marketing efforts.

The rise of AI Chatbots

As conversational AI becomes more mature, AI-driven chatbots are becoming essential tools to enhance customer interactions and improve post-purchase experiences.

Max Williams, Founder and CEO of HeroBot

The rise of AI-driven chatbots is becoming more prevalent, especially as conversational AI is introduced to great heights upon newer innovations.

HeroBot is the current entrepreneurial venture by Max. It is a rapidly growing start-up that specializes in transforming post-purchase interactions via AI-driven chatbots.

“When customers need updates on their shipment, order status, or returns, waiting for a human response can be extremely frustrating.” This insight motivated him to bring HeroBot to life as a means to offer immediate and tailored messaging based on customers’ order histories, locations, and purchase preferences.

Currently, HeroBot’s solutions are automated and connected to major messaging platforms such as WhatsApp, Facebook, Instagram, emails, and more. Max’s absolute commitment to personalization aims to foster trust, ensuring that customers feel attended to throughout their entire journey, not just at the point of purchase.

Ethan Moss, Founder of AI Humanize

Ethan leads AI Humanize, a tech company focused on creating AI solutions that enhance text readability and SEO. Although his tech business does not directly serve eCommerce, Ethan’s insights are invaluable for understanding the future of conversational AI.

“Our AI Humanizer is an AI SaaS that converts AI-generated text to human-like content,” Ethan explains. “It becomes a goldmine for eCommerce businesses looking to craft natural, engaging product descriptions and customer communications.”

Despite challenges to AI’s ability to sound human, Ethan points out that advancements over the past decade in AI significantly improved AI’s expressiveness. The efforts that he took to train the AI models have resulted in a more natural writing style, a great showcasing that AI can indeed replicate human-like communication, making it a powerful tool for eCommerce who are looking to elevate their post-purchase to the next level.

Sheldon Sutherland, Owner of Epoxy Werx

If AI-assisted customer service is going to be the norm, then Epoxy Werx is a company that has a grand vision for integrating such AI technologies into its e-business.

Epoxy Werx is a company in Arizona, specializing in epoxy garage floor installations. While it is operating in the home improvement sector, they have embraced AI technologies in ways that directly enhance its eCommerce operations, particularly in the customer experience and order tracking process.

“Enabling AI-based solutions transformed our customer communication flow,” He explains. These chatbots help us “instantly respond to customer inquiries about post-installation services and other requests,” thereby enhancing the post-purchase experience.

Also, these AI systems streamline scheduling and inventory management, helping the company avoid excess stock and improve operational efficiency.

Logistics Operations

Besides, AI is increasingly recognized as a game changer in logistics operations, revolutionizing how businesses manage their supply chains.

Ben Jhons, CEO of Big Ben

The words that Ben used are “radical” and “ever-changing.” While Big Ben focuses on waste management, the implication of AI extends significantly into logistics, especially from his own business. One of the AI applications he highlights is route optimization, which can be crucial for last-mile delivery.

As different technologies such as GPS, IoT, and RFID are in play, eCommerce companies and even waste management companies like Big Ben can enhance their last-mile experience over time.

Ben emphasizes that AI is playing a pivotal role in forecasting delivery times, selecting optimal routes, and determining the best touchpoints for customer notifications. These advancements represent a leap forward in logistics practices that predecessors could hardly have imagined. It also shows the operational boost that AI can bring to many businesses.

Damon Wu, Founder of Slipintosoft

Slipintosoft is a luxury silk products online retailer founded by Damon. As he elaborates on his business model, he mentions that a key impact of AI on his eCommerce business is on supply chain management.

“We have integrated AI-driven predictive analysis into our supply chain processes, enabling us to forecast product demand accurately and maintain optimal inventory levels. As a result, this implementation leads to minimized stockouts and overstock situations, enhancing operational efficiency”, as Damon reviews his efforts in an AI-driven supply chain.

However, he has also cited the challenges of bringing AI into the supply chain. The initial financial costs and the need for sophisticated technical skills were two of his concerns. Additionally, ethical use of AI, especially regarding customer data, is also another important but often neglected item when it comes to eCommerce operations.

James White, CEO of Amazing Moves

Two key innovations are currently applied to James’ venture: AI Integrated Tracking Systems and AI-based route optimization solutions.

James is the CEO of Amazing Move, a moving company in Denver, United States. His business is not directly related to eCommerce as well, but his pinpoint to the use of tracking systems and route optimization, aligns well with TrackingMore’s SaaS to put real-time, data-driven tracking in play for customers.

At Amazing Moves, AI is utilized during the post-purchase stage to keep clients updated on their moving services, hence improving organizational transparency.

The transparency issue is something to be disputed in James’ view, as some may question the rationale for bringing such technologies into play. However, James believes that transparency is a critical component of customer satisfaction and, thereby, a necessary investment for those who aim to advance their service quality.

Fraud Detection

As eCommerce businesses handle increasingly large volumes of transactions, the risk of online fraud and security threats has grown significantly. Some eCommerce leaders also recognize the practical use of AI to manage these emerging security risks.

Sandra Malouf, President of Eurolog Packing Group

Sandra Malouf offers a unique perspective on the application of AI, focusing on its role in fraud detection and prevention.

‘With the surge in digital transactions, online fraud and security threats have become more and more prevalent. By leveraging AI and machine learning, businesses can identify and mitigate fraud by analyzing patterns and making instant decisions”, Sandra explains.

For her business at Eurolog Packing Group, a boutique solution provider of international export,  she understands that cybersecurity risks are a constant threat in today’s digital landscape. She emphasizes that advanced AI technology not only safeguards eCommerce platforms from cyber risks but also ensures the safety of both the business and its customers.

Outside of fraud detection, there are also other AI applications not mentioned, including the use of AI for risk scoring, anomaly detection and more.

Food for Thought

Founders, do not be discouraged if you are not featured. We value everyone’s contributions to this blog article, which are all meaningful in their own right.

However, as eCommerce companies come to increasingly adopt AI on the way, a few insights should be carefully considered:

Personalization in AI Is the Future

Personalization is a powerful area of AI that brings significant value to eCommerce businesses of the future. A majority of eCommerce players have acknowledged its potential, but there is still skepticism about whether AI can truly deliver the level of customization that customers expect, along with the challenges of effectively connecting with them.

There are also a range of responses regarding AI-driven personalization tools, such as the use of chatbots and dialogue systems. They are still under development and challenges still exist before being brought to public use. Additionally, AI applications in organic search are becoming more common, with many providers offering AI-powered SEO tools available as either plugins or Shopify apps.

It also redefines the way traffic is acquired. Large-scale advertising and channel promotions are no longer effective, whereas precise marketing is the way to go.

Applying AI is Never Too Late

The advantages of AI extend to early-stage development. An effective use of AI models enables eCommerce companies to analyze market trends, user feedback, and competitor data, leading to innovative strategies that eCommerce companies have never accessed before. With time, AI is not simply for automation and efficiency.

A plethora of eCommerce founders have voiced their positive views on AI. With the applications of AI on user experience, inventory management, and decision-making, there is a lot more to anticipate from these technologies. Staying informed and embracing AI in eCommerce will be crucial for achieving success in the competitive landscape.

Integration Challenges

A few respondents, notably eCommerce founders and solutions providers, noted the challenges of integrating AI into existing systems, especially when it is legacy-based. There are expressed concerns about data consistency and processing. It refers to a call to review your infrastructure and only commit to AI systems when the business is ready to do so.

Redefine Tracking and Logistics

AI is essential in improving logistics and operations, providing automation and real-time tracking that directly benefit your customers. By leveraging AI to features such as real-time tracking and route optimization, eCommerce brands can ensure timely, consistent deliveries, thus enhancing overall customer satisfaction.

However, with the wide array of solutions available, it is important to source for the right tracking systems that align with your customers’ needs.

How about TrackingMore?

Although TrackingMore is not an AI-driven tracking platform yet, our access to 1,300+ carriers worldwide and commitment to real-time, transparent tracking positions us as a competitive tool in the market for eCommerce businesses who want an edge in logistics.

The multi-carrier approach puts adaptability and flexibility at the forefront, which are things that eCommerce players highly demand.

By using TrackingMore, eCommerce software companies, and online retailers can personalize post-purchase experiences. The tracking information we currently provide can be integrated with the development of AI chatbots.

On the other hand, we also thrive in terms of connectivity to core marketplaces such as Amazon and Shopify, so you can enjoy seamless integration. A fast 1-7 day implementation and multiple SDKs to support your development efforts.

Finally, branded tracking page, shipment dashboard, and shipment notifications can accelerate your post-purchase and logistics efforts to the next level.

Final Words

From enhancing post-purchase and personalization to optimizing logistics and fraud detection, the responses reveal that the potential of AI in eCommerce is limitless.

However, as we play forth to the AI game, challenges in integration and bringing up the human touch are both key discussions. Therefore, it also comes to another viewpoint that the adoption of AI should also be coupled with a customer-centric approach. eCommerce players should be open to exploring innovative AI solutions that align with both their business needs and customer expectations of their eCommerce businesses.

It also means that fostering a culture of continuous learning and adaptation will be vital as the eCommerce environment evolves. By staying informed about AI advancements and customer trends, businesses can better position themselves to leverage AI effectively.

As the landscape continues to evolve, embracing AI thoughtfully and strategically will be key to unlocking new opportunities for eCommerce success.